A brief corporate history
Cyanogen was set up in 2009 by Kirt McMaster (CEO), Steve Kondik (CTO), Koushik Dutta. The company has offices in Seattle and Palo Alto. Cyanogen is a leading mobile operating system company that is evolving the Android platform to create a more open, level playing field for third-party developed apps and services. The company has about 120 employees, almost all of whom are engineers.
Cyanogen describes its role as “reimagining mobile computing, giving power to the people to customize their mobile device and content experiences”. Cyanogen OS is built on Android and known for its personalization features, intuitive interface, speed, improved battery life, and enhanced security. An open OS, the company claims, “built by users for users”. Cyanogen backs the largest open source Android developer community in the world. The CEO claims: “We’re not an app. We have the potential to be a big meaningful mobile platform.”(quoted by K. M. Cutler, 2013).
The company is trying to compete with Android operating system with its interactive CyanogenMod. Based on the Android Open Source Project, CyanogenMod is designed to increase performance and reliability over Android-based ROMs released by vendors and carriers such as Google, T-Mobile, HTC, etc. CyanogenMod also offers a variety of features and enhancements that are not currently found in these versions of Android.
Business model
The company earns minimal revenue, selling “themes” designed by the company that users can apply to customize the look and feel of their phones, and currently relies on the Google Play Store for billing. As noted by C. Chavez (2014): “Cyanogen Inc’s has yet to generate any sizable revenue” (no data available on the revenues). According to the company, fifty million people already run Cyanogen on their phones. Cyanogen has a chance to snag as many as 1 billion handsets (outside Apple and Google, total number of smartphones to grow from about 2.5 billion to nearly 6 billion by 2020).
Cyanogen is planning to convince a growing list of phone manufacturers to make devices with Cyanogen built in, rather than Google’s Android aiming at taking a share of the 1 billion handset. Chinese-made OnePlus One83, a Cyanogen phone released last year is seen as outperforming many of its competitors, including, in various tests, the iPhone 6.
It starts at USD 300, without a subsidy. Their phones are selling out in record time.
Analysts say each phone could bring Cyanogen a minimum of USD 10 in revenue and perhaps much more which will be the way the company will make money. The bigger
83 Can be bought over the Internet, from USD 298. The upstart electronics company sold more than a million units of its debut phone, the One, last year by favouring overseas markets such as the US, the UK and India. Like Xiaomi, the company focuses on online, direct-to-consumer sales and deliver affordable hardware with premium specifications. Source: Lococo (2015), Bloomberg.
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opportunity will be from revenue-sharing deals with app developers who integrate their services deeply into Cyanogen-based phones.
The deals will take many forms, from distribution to in-app purchase agreements to customized services for specific countries. In 2014, Micromax, the market leader in India, began selling Cyanogen phones under its high-end Yu brand. The deal made Micromax the exclusive Cyanogen seller in India. A phone is being made by Blu. A Miami company that has become one of the most popular phone makers in Latin America; its phones are sold in the U.S. through Wal-Mart and Best Buy and are among the bestselling unlocked phones on Amazon. The phone will be released later in 2015. In Asia, Baidu, Tencent (one of its early investors), Alibaba and China Mobile should be its main targets, since they have faced problems in creating their own ecosystems.
The company inked an alliance with Qualcomm to integrate Cyanogen OS with Snapdragon processors. In April 2015, Cyanogen and Microsoft announced a partnership to integrate popular Microsoft services across the Cyanogen Operating System. The wide-ranging partnership will incorporate several of Microsoft’s mobile services, including Bing, the voice-powered Cortana digital assistant, the OneDrive cloud-storage system, Skype and Outlook.
Financial data
As of May 2015, Cyanogen has raised a total USD 110 million in funding. Cyanogen just raised USD 80 million from investors that include Twitter, mobile chip powerhouse Qualcomm, Telefónica Ventures, Redpoint Ventures, Santander Innoventures, Smartfren Telecommedia titan Rupert Murdoch, Tencent and contract manufacturer Foxconn. The round, which values Cyanogen at close to USD 1 billion84, is being led by PremjiInvest, the investment arm of Wipro’s billionaire founder, Azim Premji, India’s third-richest man.
In 2013, earlier investors pumped an additional USD 30 million into Cyanogen, among them: Benchmark, Andreessen Horowitz, Redpoint Ventures and Tencent.
Founders
Steve Kondik, is a 40-year-old entrepreneur and veteran programmer. Before starting the company, he led a research and development team at Samsung Mobile.
Kirt McMaster, Canadian, joined a Silicon Valley startup during the dot-com boom and helped run Boost Mobile. McMaster later went to work at Sony.
Koushik Dutta was an independent app developer and a mobile industry veteran. Koush received his Computer Science degree from Michigan State University.
Key words: Android’s competitor, mobile customization, mobile platform, revenue sharing.
Chavez, C., (2014), “Cyanogen Inc looking for $1 billion valuation after receiving acquisition offer from Google”.
84 USD 500 million, according to Bloomberg.
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cyanogen-inc-wa lked-away-from-google-buyout-offer-now-looking-for-1-billion-in-funding /
Cutler, K.M., (2013), “CyanogenMod Quickly Raises Another $23 Million Led By
Andreessen Horowitz”. http://techcrunch.com/2013/12/19/cyanogenmod-quickly-raises-another-23-million-led-by-andreessen-horowitz/
Helft, M. (2015), “Meet Cyanogen, The Startup That Wants To Steal Android From Google”. http://www.forbes.com/sites/miguelhelft/2015/03/23/meet-cyanogen-the-startup-that-wants-to-steal-android-from-google-2/
Lococo, E., (2015), “China’s Hottest Phone? Here’s the Upstart Chasing Xiaomi”.
http://www.bloomberg.com/news/articles/2015-03-10/china-s-hottest-phone-maker-here-s-the-upstart-chasing-xiaomi
Waring, J., (2015), “Cyanogen lines up $110M in funding, has bigger plans”.
http://www.mobileworldlive.com/cyanogen-lines-110m-funding-bigger-
plans?utm_campaign=MWL-D-20150318&utm_medium=email&utm_source=Eloqua
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